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Mis-Sold investment - Stadia Trustees

Latest Update: 13th June, 2018 (The London Gazette)

Case Points

Total amount invested

£100 million

Why did people invest in it?

Clients may have invested in Stadia due to the high rates of return offered by non-standard investments that were available.

Why was it mis-selling?

Following an FSA investigation in 2011 related to poor due diligence, Stadia voluntarily gave up their Part IV permission with immediate effect. In 2013, they voluntarily gave up all permissions to undertake new business.

Potential value of cases

An estimated £83,000, reached by dividing £100 million equally between 1200 policies.

Summary

Stadia Trustees Ltd was a SIPP provider based in Colchester. Founded in 2006, they successfully sold SIPPs products for a number of years. However, in 2011, the FSA launched an investigation into a number of providers. Eight firms were selected for investigation. Those investigated included Stadia.

The inspection of Stadia and the other seven firms was linked to their consistent inclusion of overseas and unregulated investments within their SIPP products. These were often sold as being likely to achieve better returns, specifying that these would be above what could be achieved by traditional pension products. The FSA voiced serious concerns in the aftermath of the investigation, as they believed that Stadia and their competitors were not conducting sufficient due diligence into the investments they allowed their clients to include within SIPPs. Other issues were raised in the report in relation to the failure to adequately secure client money, identify risk, and risk mitigation.

In response to the FSA report and regulatory changes during 2012, Stadia Trustees voluntarily gave up their Part IV FSA permission in February 2013. This meant they could not take on any new business. This was effectively an admission of structural failings by the company, as it showed that they believed that they could not meet regulations at the current time without significant revision of their business practices. While Stadia stated they intended for the status change to be “for the short term while we engage some structural changes”, they never regained the ability to conduct new business. This was because almost half of assets within their SIPP products were unregulated, and approximately 80% of customers were exposed to these unregulated assets.

By 2016, Stadia was unable to continue serving their customers, and Mattioli Woods was appointed to administer the SIPPs previously run by Stadia. The total value of business acquired by Mattioli Woods was over £100 million in assets under management, spread across approximately 1,200 separate arrangements. In January 2018, Stadia was found to be in default by the FSCS, and voluntarily entered into liquidation. Mattioli Woods, who did not acquire Stadia’s advice liability, estimated a total cost to the FSCS of up to £41 million.

You are likely to have a potential claim on the basis of advice from a regulated firm. The claim above is only an example of a potential claim. Each claim is judged on its individual merits and as such, we cannot guarantee that your individual claim will be successful or that you indeed may have grounds for a claim.

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